Funny How Microsoft's Views On Responsibility To Competitors Differ Based On Who's In The Antitrust Hot Seat

from the this-is-known-as-hypocrisy dept

We recently mentioned the latest round of Microsoft's antitrust fight, dating back to some of its actions around Windows 95. To be clear, I think the action against Microsoft is pretty silly. It's pretty clear that the market is quite capable of dealing with any perceived Microsoft "monopoly" and routing around it. That said, one thing that is quite stunning in all of this is the sheer hypocrisy from Microsoft in discussing this case, as compared to Microsoft's own efforts to drag Google into an antitrust battle as well. Now, some will shrug and say that this is basic self-interest on Microsoft's part. It's always going to favor things that help Microsoft. But it certainly seems to weaken the validity and credibility of Microsoft's arguments.

Back in March, we noted just how ridiculous this was, when Microsoft complained about Google to the European Union, whining that Google made it difficult for Microsoft's platforms (mainly the Bing search engine and Microsoft's mobile platform) to access YouTube video data. At the time Microsoft's General Counsel sure seemed to insist that Google had a duty to engineer its platform to make life easier for its competitors. Here's the quote we highlighted back in March:

First, in 2006 Google acquired YouTube--and since then it has put in place a growing number of technical measures to restrict competing search engines from properly accessing it for their search results. Without proper access to YouTube, Bing and other search engines cannot stand with Google on an equal footing in returning search results with links to YouTube videos and that, of course, drives more users away from competitors and to Google.

Second, in 2010 and again more recently, Google blocked Microsoft's new Windows Phones from operating properly with YouTube. Google has enabled its own Android phones to access YouTube so that users can search for video categories, find favorites, see ratings, and so forth in the rich user interfaces offered by those phones. It's done the same thing for the iPhones offered by Apple, which doesn't offer a competing search service.

Note how in both paragraphs, Smith seems to clearly suggest that Google has a duty to engineer its products to make life easier for Google's own competitors.

Okay. Now, jump over to the ongoing antitrust lawsuit against Microsoft by Novell. And note how Microsoft's lawyers appear to argue directly against this idea that a company should have a duty to build its products to help competitors:

Microsoft attorney Steve Aeschbacher said Novell is saying it wishes Microsoft would have developed Windows 95 differently than it did.

"The law basically doesn't require people to design their products to the whim or demand of other companies. You get to design your own products. There isn't any legal obligation for us to do what they wanted us to do," he said.

Seems to directly contradict what Microsoft said just months ago when it was talking about Google. Furthermore, in Microsoft's motion for summary judgment (pdf) in the current case -- a brief you can be sure MS General Counsel Brad Smith was well aware of -- Microsoft again appears to argue the exact opposite of what it said in regards to Google just months ago:

The allegations underpinning count I are premised on the notion that Microsoft
had some affirmative duty to assist—or to continue assisting—a competitor. Novell
complains that Microsoft harmed its office productivity applications designed for use with
Windows 95 by (i) discontinuing the formal documentation of six APIs in pre-release
versions of Windows 95, (ii) failing to include in Windows 95 certain functionality that
Novell would have liked, and (iii) failing to endorse Novell’s applications by granting Novell
a license to use the Windows 95 logo. These allegations are not cognizable under the
antitrust laws.

The objective of our antitrust laws is to promote competition. Successful
companies—even monopolists—are encouraged to compete vigorously. Foremost Pro
Color, Inc. v. Eastman Kodak Co., 703 F.2d 534, 544 (9th Cir. 1983) (“A monopolist, no less
than any other competitor, is permitted and indeed encouraged to compete aggressively on
the merits.”). Monopolists are encouraged to innovate and are entitled to retain the benefits
of such innovation. Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 281 (2d Cir.
1979). Moreover, a monopolist is not required to help its smaller rivals or shield them from
the rigors of competition. Olympia Equip. Leasing Co. v. Western Union Tel. Co., 797 F.2d
370, 375-76 (7th Cir. 1986) (“A firm with lawful monopoly power has no general duty to help its competitors.”); Twin Labs., Inc. v. Weider Health & Fitness, 900 F.2d 566, 568 (2d
Cir. 1990) (“Antitrust law . . . does not require one competitor to give another a break just
because failing to do so offends notions of fair play.”).

I agree very much with the Microsoft filing in this case. Antitrust law shouldn't be about propping up competitors or requiring a company to engineer its products in a certain manner to help competitors. And while I understand that Microsoft's position will shift depending on whatever benefits Microsoft best, it seems like the company is being ridiculously short-sighted in being so blatantly hypocritical and inconsistent. It hurts its chances in this particular lawsuit, and it hurts Microsoft's overall credibility. While I understand that Microsoft thinks tossing around antitrust accusations at Google may make life difficult for Google, it seems like both companies would be a lot better off if neither of them tossed antitrust arguments at the other. It seems only likely to backfire.

Given the topic at hand, I believe it pertinent to share a few anonymous quotations about Microsoft that I have come across online:

Windows [n.] - A thirty-two bit extension and GUI shell to a sixteen bit patch to an eight bit operating system originally coded for a four bit microprocessor and sold by a two-bit company that can't stand one bit of competition.

The number of holes in Microsoft products would put a Swiss cheese to shame.

The day Microsoft makes something that doesn't suck, they'll be making vacuum-cleaners.

The "innovation" was only in the specific means used to hamper Novell, NOT in any actual product.

>> Moreover, a monopolist is not required to help its smaller rivals or shield them from the rigors of competition. Olympia Equip. Leasing Co. v. Western Union Tel. Co., 797 F.2d 370, 375-76 (7th Cir. 1986) (“A firm with lawful monopoly power has no general duty to help its competitors.”); Twin Labs., Inc. v. Weider Health & Fitness, 900 F.2d 566, 568 (2d Cir. 1990) (“Antitrust law . . . does not require one competitor to give another a break just because failing to do so offends notions of fair play.”)."

Those CANNOT be applied to operating systems: the producer of operating systems must be held to STRICT neutrality so that ALL companies have equal shot at writing software for a given platform. Commonality of platform is in the public interest, but don't try to claim that Microsoft is justified by leveraging its -- already monopolistic -- control of the operating system to advantage its other products: that's the definition of a monopoly in software. With the operating system product, Microsoft is in position to /completely/ control the playing field itself, and that's what they /did/.

Mike sez: "I agree very much with the Microsoft filing in this case." -- Again, Mike pretends to be libertarian, but dismisses the actual Microsoft monopoly as "perceived", and then agrees "very much" with the mis-applied references Microsoft uses. Every time it gets to the crunch, Mike is in favor of corporations: Standard and Poor file false reports, so Mike says change the rules and don't rely on them, and under no circumstances should the officers of S&P be held personally liable. Mike extends the corporate shield even to Righthaven's officers, doesn't want them held /personally/ liable for trying to extort $150,000 on false pretext. And even here, after exposing Microsoft's duplicity, Mike is still /for/ Microsoft! Talk about blind to the overall pattern. Doesn't appear that Mike is ever against a monopoly, or /for/ antitrust. -- Mike is the product of Ivy League academia, and so his views reflect those of the ruling class who think that "capitalism" is just great because they were born into privileged places.

Re:

Re: Re: 90+ percent is only a 'perceived Microsoft "monopoly"', eh?

It IS a monopoly to have 90+ percent of the market. Microsoft /has/ a monopoly. They built it illegally, as has been proven in court, and use it as much as they dare. Microsoft has always had inferior products and ruthless business practices that leverage off the OS. If you look at the amount of time wasted sheerly on fiddling to maintain Microsoft products, it's the biggest disaster ever to afflict the human species.

Now, since you don't /know/ whether Microsoft used its "size maliciously to force other[s] out of the market", and you don't seem to grasp that the cause here is Microsoft deliberately hampering Novell through API and other items listed above, NOT anything about including a browser, then you're just adding more empty irrelevant contradiction: that's all you have, sonny.

Re: Re: 90+ percent is only a 'perceived Microsoft "monopoly"', eh?

Controlling 90% of a market is almost certainly a monopoly. Controlling 100% of a market is certainly a monopoly. A company doesn't achieve monopoly status only when it does something illegal. "Lawful monopoly" is not an oxymoron. Using improper/anti-competitive means to achieve a monopoly or wielding monopoly power to pursue anti-competitive ends is illegal. But a monopoly may be achieve in a perfectly lawful manner.

Re:

"Why would anybody need a Windows PC?"

Because last time I tried, I couldn't get any major business applications (accounting, law, medical, etc.) to run on my PS3.

Business runs on Windows, especially the SMB segment. It isn't by choice necessarily, but because that is where the business app development is it. In an SMB financial services firm, we run around 10 major apps. The number of those apps that have Linux or Mac versions: 0.

I'll leave the MS bashing to others; I know it works pretty well for us. Just pointing out that most of the daily business in the United States runs on Windows (more people are employeed by SMB's than Enterprise in this country).

Microsoft is a convicted corporate monopolist, in full legal sense. Also, any random bunch of people would agree with me that Microsoft /has/ a monopoly. That legalistic corporate serfs try to make such an idiotic definition as a 2% monopoly just shows that you're barely above dogs, certainly so in the view of your corporate masters. ARF, ankle-biter.

Re: Mike: "I agree very much with the Microsoft filing in this case."

You're arguing that 'libertarian' means 'against monopoly' or 'anti-trust?' Really? That's, well back-flips and contortions don't really go far enough to describe that really. OotB appears to be a product of ignorance and a fevered nightmare.

Re: Re: 90+ percent is only a 'perceived Microsoft "monopoly"', eh?

@ Anonymous Coward, Oct 21st, 2011 @ 11:34am

This is why we don't get technical definitions for field specific concepts from internet commenters.
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The field of "economics" is sheerly opinion about who labors and who lives in idle luxury. It's not a "hard" science: it's not a difficult course, you just rephrase what you know the prof wants to hear. Marx was just as good an economist as Keynes or Friedman: so's anyone who manages a family budget. My opinion on economics is just as good as Mike's, especially if supported by the majority of people as I think mine is. I suppose you think you're in an elite 1% and the 99% have no say in how the economy gets runs: no, you're probably just a techno-serf, neutered so that you can't challenge your masters.

Re: Re: Mike: "I agree very much with the Microsoft filing in this case."

@Anonymous Coward, Oct 21st, 2011 @ 11:53am

You don't just appear to be ignorant and in a dream, but manifestly are, besides a merely contradictory ankle-biter.

Since you seem to have missed this entire paragraph, and particularly the word "pretends", I'll just repeat it:

Mike sez: "I agree very much with the Microsoft filing in this case." -- Again, Mike pretends to be libertarian, but dismisses the actual Microsoft monopoly as "perceived", and then agrees "very much" with the mis-applied references Microsoft uses. Every time it gets to the crunch, Mike is in favor of corporations: Standard and Poor file false reports, so Mike says change the rules and don't rely on them, and under no circumstances should the officers of S&P be held personally liable. Mike extends the corporate shield even to Righthaven's officers, doesn't want them held /personally/ liable for trying to extort $150,000 on false pretext. And even here, after exposing Microsoft's duplicity, Mike is still /for/ Microsoft! Talk about blind to the overall pattern. Doesn't appear that Mike is ever against a monopoly, or /for/ antitrust. -- Mike is the product of Ivy League academia, and so his views reflect those of the ruling class who think that "capitalism" is just great because they were born into privileged places.

Re: Mike: "I agree very much with the Microsoft filing in this case."

True libertarianism (and not this American shite) is to believe in a minarchist State. That is to say, little State involvement in how people live. Taxation may come under this umbrella, but it is ALSO a method of ensuring a contribution to society.

What you're saying is not libertarian in the slightest. It is, as best, incoherent, and at worst, comedy gold in its insanity.

Re: Re: Mike: "I agree very much with the Microsoft filing in this case."

@The eejit (profile), Oct 21st, 2011 @ 12:08pm

True libertarianism (and not this American shite) is to believe in a minarchist State. That is to say, little State involvement in how people live. Taxation may come under this umbrella, but it is ALSO a method of ensuring a contribution to society.

What you're saying is not libertarian in the slightest. It is, as best, incoherent, and at worst, comedy gold in its insanity.

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It's not clear who you're agreeing or disagreeing with. If agreeing with me that Mike's version of "this American shite" is a pretense, then thanks. If you seek to distance his views from this unknown "minarchist", then you seem to agree with me again. If you're saying that I'm promoting libertarianism, no, you're way wrong. I'm a Populist. Libertarianism is basically a notion of self-styled elites who are actually mere grifters: they want to "privatize" everything, can't imagine that corporate control of the common wealth could be bad, and wittingly or not, fall directly into hands of neo-cons and fascists.

Re: Re: 90+ percent is only a 'perceived Microsoft "monopoly"', eh?

That's not quite right. It isn't a violation of antitrust law to have a monopoly; only to have acquired it illegally or to have abused it. But there's no question that Microsoft had a monopoly from a legal point of view, so it doesn't need to be qualified.

Lawyers and oxymorons

Microsoft has long had an abusive monopoly.

Microsoft has abused their dominant market position many times. OEM exclusivity requirements (Windows), tie-ins (IE), takeovers of competitors. If anyone has played the underhanded card perfectly, it's Microsoft.

The only reason they have dominance in the OS market is because they've ruthlessly crushed competition wherever possible. Or supported others in efforts to crush competing products (SCO vs Novell re: Linux).

In fact, even when they don't have a monopolistic position, they'll try the same old dirty tricks to get there. (XBox and LIVE: Preference requirements for software)

Re:

could you find me a CFD packages for an iPad? how about a FEA package? Excel(with VBA)? you have no idea how many pieces of "software" are nothing but excel wrapped up in a fancy package.

Anyways, The day I don't need a windows system to do work as a mechanical engineer will be a happy day for me. I'd love to have a linux system instead. I could manipulate data so much better and get things done faster with a real scripting language around.

Re: Re: Re: Mike: "I agree very much with the Microsoft filing in this case."

Not quite. I think of it as non-interference outside of actually, y'know, running the State. A balanced taxation, a 'true' collective vision of justice, and a media that doesn't have to lie cheat and steal in order to survive. If you want a true free-market, then you don't interfere.

I equate it, roughly, as like a mythology where a Supreme Being created the Universe, then left it to itsw own devices.

Re: Re:

Levels of Monopoly Abuse

I see the gray in determining if a Monopoly must engineer products openly enough for competitors to connect to, but Microsoft didn't limit itself to such minor fare. It threatened computer makers who wanted to offer competing software on their systems and paid to keep competition off of the menu available to consumers.